Friday, January 18, 2008

Get the lead out?

How's this for innovation: $14,000 for a fully loaded, midsize sport utility vehicle with a leather interior.

The catch: It's made in China....."There are a number of very aggressive car companies in China," said John Parker, a Ford vice president who works closely with a Chinese carmaker through a joint-operating agreement. "Their cars are progressively getting better. I think it will be a very significant industry in terms of size and scale."

Probably coming to U.S. roads soonest are cars from China America Cooperative Automotive, a U.S. company with an exclusive contract to sell 600,000 pickups and SUVs, including the $14,000 model, over five years. Chamco Chairman William Pollack says the cars will go on sale at the end of this year or early 2009 in nine states, including California.

....Several other Chinese companies say they aren't far behind. Hunan Changfeng Motor Co. says it will sell SUVs in the U.S. next year. Chrysler signed a deal with Chinese company Chery last month to make economy cars it would badge as Dodges and sell in the U.S. starting in 2009.BYD, a Shenzhen company, says it could market sedans, including a plug-in hybrid, in the U.S. in three to five years.

Meanwhile, China's largest automaker, Geely Group, said this week it will build a plant in Mexico.

Like most products from China, the central marketing approach will be affordability. It's the same road taken by Korean carmakers Hyundai and Kia in the past two decades, and, further back, Japan's Toyota and Honda. Yet with models that have retracting hardtops, anti-lock brakes and heated seats, the Chinese say they're not hawking econo-boxes, despite prices that almost never break $20,000.